A digital token for your Ferrari

A digital token for your Ferrari

The two firms are planning to bring as many as 500 collectible cars worth over $200 million onto the exchange

The bubble burst after regulators started to crack down, citing fraud and questionable practices from a number of ICOs that cost their investors millions in lost funds. (Credit: Getty Images)

Always dreamed of owning a Ferrari but can’t afford it? Well, this may sound vaguely familiar: The blockchain has a solution for you.

CurioInvest, an investment platform, and MERJ Exchange Ltd, a Seychelles-based digital asset exchange, are partnering to offer tokens backed by collectible cars. The companies say tokenizing the luxury assets as an investment could make them widely accessible to a bigger pool of people.

“You can have a guy in Uganda who’s able to invest in a rare car that’s kept in a vault in Stuttgart, tokenized by a company in Liechtenstein and it all fits within this recognized regulatory environment,” Jim Needham, head of digital strategy at MERJ, said by phone. “It’s a perfect illustration of what this, as a tool, what blockchain technology and distributed ledger technology can do to democratize the capital markets.”

CT1, as the token is known, is part of the resurgence of offerings emerging amid a recent bounce in cryptocurrency prices. In fact, the method -- which lets companies bypass the venture-capital process and allows investors to purchase fractions of an asset -- originally gained traction during the crypto craze in 2017 and 2018. Back then, hundreds of companies took advantage of the mania to raise billions in funding.

The bubble burst after regulators started to crack down, citing fraud and questionable practices from a number of ICOs that cost their investors millions in lost funds.

New offerings have slowed significantly over the past year after topping out at $5.8 billion in July 2018. Companies raised about $11 million in January, according to data compiled by CoinSchedule.

But CurioInvest and MERJ are betting that the value of rare and collectible assets -- which includes vintage cars, wines, and jewellery, among other things -- will continue to appreciate. Vintage cars, for instance, returned more than 330% in the 10 years through 2017, according to a report from Knight Frank.

The two firms are planning to bring as many as 500 collectible cars worth over $200 million onto the exchange.

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